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SCENARIOS-Possible outcomes of Chile's Chuqui strike vote

Published 12/29/2009, 12:23 PM
Updated 12/29/2009, 12:27 PM
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SANTIAGO, Dec 29 (Reuters) - Union workers at Chile's Chuquicamata, one of the world's biggest copper mines, voted on Tuesday to strike over pay, sending global prices for the red metal higher [ID:nN29156858].

Here are some possible outcomes of the vote at the mine, owned by Chilean government miner Codelco:

LAST MINUTE DEAL

A last minute deal is possible but seems unlikely. Codelco, the state company that owns the mine, appears doubtful to exercise its right to request government mediation to settle differences over its wage offer. Mediation would have put off a potential strike for five days.

The company appears to be betting that union leaders will pull workers back for another last-minute vote on Wednesday to avert a Thursday strike. But this is seen as unlikely because time is very short and because a fresh vote is purely optional.

Recent mediation for other mining companies in Chile have not been successful, and some company sources have said they don't expect the company to resort to it.

Company and union officials have said an agreement to avert a strike during any mediation would be very difficult.

SHORT STRIKE

If feverish last-minute talks within the union fail, a short strike of a few days or not more than a couple of weeks is seen as the most likely outcome of the vote to strike.

Union leaders are currently planning for the strike to begin at 5 a.m. local time (0800 GMT) on Dec. 31.

Strikes at Codelco operations are unusual -- there has not been a serious strike by state mine workers in Chile since 1996 -- and workers voted by a narrow margin to strike.

By not seeking mediation, Codelco has made it very clear that it does not want to budge, which is seen pressuring workers to become more realistic in their demands.

Chilean experts say the strike will not have much backing around the country because most Chileans do not understand the Chuquicamata workers' position, because they are considered well-paid.

The tight result in the vote shows a divided workforce that could lean toward lifting a strike if there is little visible prospect of a better deal to end the stoppage.

Some union leaders could push for quick agreements to help their own ambitions within both Codelco and the political arena, and residents of the nearby town of Calama, which depends on the workers' pay, could also pressure miners to end a stoppage.

LONG STRIKE

A prolonged strike is considered unlikely, but if it happened it would be a symptom of a disconnect between union leaders and the rank and file.

Unionized workers have accused the leaders of being too soft and not pushing for maximum benefits.

But outside experts see the workers' demands as unrealistic within the wider social and mining context in Chile.

The strike could also run on if the company decides to stand its ground and try to build public opinion against the striking miners, who many Chileans already feel are reaping a disproportionate share of the country's copper riches.

A strike would also come as analysts foresee the threat of more labor strife in the sector next year if presidential front-runner, center-right airline magnate Sebastian Pinera, is elected in a Jan. 17 run-off.

Pinera has vowed to sell up to 20 percent of Codelco if he wins the presidency, which union leaders have vowed to resist, though his camp have said it is not a policy priority. (Reporting by Fiona Ortiz in Buenos Aires and Alonso Soto in Calama; Editing by Simon Gardner and Marguerita Choy)

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